Search

This study was motivated by the quest to investigate how the interaction between corruption and institutional quality affects Nigeria's economic performance by testing the validity of the "sand the wheels" and "grease the wheels" corruption hypothesis through the Barro-type endogenous growth model from the Nigerian perspective which has been ignored by extant studies. Annual time series data obtained from the World Development Indicators (WDI), the Transparency International(TI),and the Central Bank of Nigeria (CBN) from 1970 to 2020 were used to conduct the study's analysis. The study employed the Autoregressive Distributed Lag (ARDL) approach to determine the interactive effects of corruption and institutional quality on economic performance. The study revealed that corruption-institutional quality interaction exerts a negative and significant impact on economic performance. This supports the assertion that institutional quality in Nigeria is feeble and overwhelmed by the magnitude of corruption and the level of individual influences. The trajectory of Nigeria's economic performance is impeded by high level of corruption and weak institutional quality. Therefore, it is imperative for policy interventions to focus on tackling the incidence of corruption, improving institutional qualities which would have ripple positive effects on Nigeria's economic performance.

In response to shocks, emanating from the global financial crisis of 2007-2008 the Central Bank of Nigeria has continuously used tight monetary policy instrument to check volatility in the general price level. The success of using monetary policy tool to influence the movement of key macroeconomic aggregates in Nigeria rests solely on the question of whether inflation is driven purely by changes in monetary aggregates. Using quarterly time series data for Nigeria over the period 1970 to 2011, we test the quantity theory relationship between money and price movement to establish if inflation is always and everywhere a monetary phenomenon. Using the autoregressive distributed lag (ARDL) modeling approach we obtained a robust estimate for Nigeria. The result of the study shows that inflation is not always and everywhere a monetary phenomenon in the case of Nigeria raising serious doubt on the continuous use of monetary policy tool to achieve price stability in Nigeria.